Global Business Model Innovation

By M. Isi Eromosele

Globalization and new technologies are giving rise to an unprecedented level of business competition while still creating extraordinary opportunities for companies to differentiate themselves in the marketplace. In today’s global, interconnected environment, business organizations face a major challenge in how to maximize shareholder value and sustain growth, while at the same time creating economic value for all.

An organization’s business applications and its technology underpinning form the foundation upon which it can implement innovative, market differentiating business processes. While product, service and operational innovations are important, innovation must also be applied to a company’s core - the way it does business and drive revenues.

With intensified competition, rising customer expectations and globalization affecting the way companies do business, fundamental business changes are necessary to remain competitive. Business Model Innovation is the answer. The way a company does business is an important differentiator, because operational innovations cannot be imitated the way products and services innovations can be copied. The competitive advantage engendered by continuous business innovations offer more long-term market domination.

Business model innovation is a way to preempt competitive threats from industry and non-industry competitors. Companies should strive to be the ones driving change within their industries, instead of being followers.

Over the past several years, competitive strategy has been evolving from one that is a zero-sum game where one competitor gains an advantage at the expense of the other, to one that is collaborative, where joint efforts create more economic value for all involved.

In competing for global markets, traditional competitive strategy stresses that companies be positioned in well defined markets, striving to build market share. In today’s interconnected global economy, the new competitive strategy calls for companies to be pre-positioned in emerging markets and co-develop these markets with partners, including their competitors, to maximize value.

In competing for market share with new products, traditional competitive strategy employed a closed business model by which companies competed by spending vast amount of funds on research and development. Today, an increasing number of companies are adopting the open business model by which they share expertise with carefully chosen partners, jointly developing products.

Traditionally, global businesses competed for customers through advertising in newspapers, on television and radio. Today, the more effective way is to develop long-term customer relations through web based technology with major focus on interactive communications and communities of interest.

Within their companies, major business leaders need to affect major organizational changes, eliminating divisional boundaries and leveraging shared services across the enterprise. In the current global economy, it is necessary for them to pursue new business opportunities, new competencies and new alliances that create value for their companies.

Innovations need to be implemented proactively which would result in business designs that are truly differentiating. This would enable them to be better equipped to respond to market realignments and internal operational demands. Additionally, forming collaborative partnerships will enable them to lower their operating costs, while providing opportunities for increased revenue generation.

M. Isi Eromosele is the President | Chief Executive Officer | Executive Creative Director of Oseme Group - Oseme Creative | Oseme Consulting | Oseme Finance

Copyright Control © 2011 Oseme Group

Global Transformation Of The Multinational Corporation

By M. Isi Eromosele

The typical multinational corporation, which had been the primary catalyst for globalization, has been slowly transformed, even as the paradigm for doing international business has evolved during the past decade. In its new form, it represents a new type of business organization – a globally integrated enterprise.

Global Integration

The transition from multinational Corporation to Globally Integrated Enterprise has assumed two profound forms. The first has produced changes as to where goods are produced and the second, changes as to who produces them. Up to a decade ago, companies generally preferred to produce their goods close to where they were sold. As such, most foreign investments targeted carefully chosen global markets. Today, overseas investment is geared more towards where access and thus market share could be gained to meet important sources of foreign demand. Economies of scale strategies have been implemented to streamline and consolidate production processes, thereby eliminating unnecessary bottlenecks.

This change in production in global production initiatives have been most manifested in China and India. In China, foreign companies have built over 150,000 manufacturing plants since 2005. Some of these factories target the huge Chinese domestic market, but many others target the global market. Japanese car makers, European chemical companies and United States based industrial and machinery companies have built and are still building factories in China to supply export markets around the world. Additionally, banks, insurance companies, professional services firms and information technology companies are building R &  as well as service centers in India to support employees, customers and production on a global basis.

The above changes reach far beyond China and India. Radiologists in the United States send x-rays to Australia for analysis and interpretation. Customer service centers in Switzerland handle warranty enquiries for shoppers in the United States. Procurement centers in the Philippines process corporate purchasing on behalf of organization based in multiple countries around the world. Employees in Dublin, Ireland handle back office processes and process derivatives transactions for global investment banks located in New York, London and Frankfurt.

In the United States, biotech and pharmaceutical companies, such as Roche have built manufacturing and R & D centers to support their global research and production. Japanese chipmakers, such as Samsung and chip manufacturing equipment companies, such as Tokyo Electron, are leveraging U.S. based engineers and their knowledge to advance their manufacturing technologies.

Systemic Changes

The globally integrated enterprise requires fundamentally different approaches to production, distribution and global work-force deployment. New technologies and business models are enabling global companies to treat their far flung functions and operations as component pieces that can be transformed and adapted to respond to customer needs in any part of their global markets. These decisions are made based on strategic judgments as to which operations the company wants to excel at which it thinks is best suited to a particular marketplace. The extraordinary growth of service firms providing specialized expertise makes this possible.

New forms of collaboration are everywhere in global business; from increasingly complex intercompany production networks to open-source software production, which helped transform the traditional model of innovation. Today, innovation occurs mostly through a collaborative process that also combines technological and marketing expertise.

The globally integrated enterprise delivers enormous economic benefits to both developed as well as emerging economies. The integration of the work force in developing countries into advanced systems of global production has raised living standards, improved working conditions and created millions of jobs in these countries. The spread of shared technologies and business standards is creating an unprecedented opportunity for further global integration, not just within each sector of society, but across all of them.

M. Isi Eromosele is the President | Chief Executive Officer | Executive Creative Director of Oseme Group - Oseme Creative | Oseme Consulting | Oseme Finance

Copyright Control © 2011 Oseme Group

Sustaining Global Business Momentum

By M. Isi Eromosele

As domestic markets mature, pressure is rising on companies to expand their markets beyond traditional boundaries to other countries of the world. The result is that decision making within these companies is becoming distributed across multiple geographies, requiring the development of adaptive strategies. The advent of advanced wireless technologies is enabling countries to rapidly provide integrated networks that facilitate the dense interconnection of global economies. Combined with advanced networks, business information distribution is being elevated to an unprecedented high level of efficiency, facilitating decision making and accelerating deal closings.

Globally, this is an age of increased convergence of business relationships, technologies and cultures. This is driving the migration of data and the business intelligence it engenders from central repositories to decentralized global locations. The foundation for sound business intelligence is robust, accurate and readily available information. At the core of sound business intelligence is the contextual value of information. To be successful as a global company, an organization has to comprehend the value of its business in the context of the market microcosms in which it competes. This requires global thinking applied locally, in context, at the right time at the right place.

The crucial role of information in determining global business success is increasing dramatically. Unstructured corporate decision making will no longer work and should be replaced with well-informed decisions at the point of business supported by advanced data analysis. The value of information changes spectacularly across its lifecycle in a non-proportionate manner. Information management has been proven to be a competitive advantage that impacts revenue generation and the corresponding costs of corporate expenses.

Business takes place around the clock and the globe.

A successful information lifecycle global management strategy should be:

• Business-centric – tying it closely with key processes, applications and initiatives of the business
• Policy-based – anchored in enterprise wide information management policies that encompass all processes, applications and resources
• Centrally manage – providing an integrated view of all information assets of the business, both structured and unstructured
• Adaptive – encompassing all types of data, platforms and operating systems

Business intelligence is the contextual application of information at the point of business execution. Business is best applied at the point where business decisions and transactions are made. This requires the integration of underpinning infrastructure assets from end to end, advanced data analysis techniques with an optimized approach for the delivery and presentation of information.

In a global knowledge-driven economy, the delivery of crucial business intelligence to the point of decision is critical. The efficient and effective delivery of this intelligence will be a critical success factor in the global success of an enterprise. The future of business is interactive, networked, context aware and situation optimized, spanning the globe.

M. Isi Eromosele is the President | Chief Executive Officer | Executive Creative Director of Oseme Group - Oseme Creative | Oseme Consulting | Oseme Finance

Copyright Control © 2011 Oseme Group